Dive Brief:
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Anthem will most likely pull out of a “high percentage” of the ACA insurance exchanges where it currently participates for the 2018 coverage year, according to a Bloomberg report based on a research note from analysts with investment banking firm Jefferies.
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Anthem lost $374 million in the individual insurance market last year, but expected to profit modestly on its exchange plans and estimated 8.6% of its revenue would come from those plans in 2017, the report adds.
- Payers are concerned, especially with healthcare reform efforts stalled, that cost-sharing reductions will not continue, but some Congressional Republicans are pushing to include funding in an upcoming spending bill, Bloomberg reported.
Dive Insight:
Payers only have until June 21 to file initial plan designs and rate suggestions to participate in insurance exchanges in most states for the 2018 coverage year. With many questions about the future of insurance exchanges unanswered, Anthem may be just about ready to give up on the exchanges altogether, just like Humana did in February. Humana argued that it was "seeing further signs of an unbalanced risk pool." It covered around 150,000 consumers through exchanges.
If Anthem chooses to leave exchanges, it would be a significant blow. Exiting all exchanges where it currently operates would leave consumers in at least 200 counties across six states with no options available to them, according to a tweet from Cynthia Cox, an associate director at the Kaiser Family Foundation.
There are at least 200 counties where an Anthem exit could leave no #ACA exchange insurer
— Cynthia Cox (@cynthiaccox) March 30, 2017
CO: 14 counties
NV: 10
KY: 59
MO: 75
OH: 20
VA: 28
It would not be that surprising for Anthem to end its participation. Last month, Anthem CEO Joseph Swedish indicated that the payer would not make a decision until there was a clearer idea of where policy was headed and said the exchanges have “not been working well.” In addition, Swedish expressed support for the GOP's ACA repeal bill, which was pulled from a House vote last Friday.
For payers to get back on board, Congressional lawmakers and the President Donald Trump administration need to provide a clearer idea of what is going to happen with subsidies for health plans sold to low-income consumers, risk corridor money and the individual mandate. However, healthcare reform is at a standstill in Congress and the Trump administration has given mixed signals regarding its support for payers participating on exchanges as it issued a market stabilization rule but canceled outreach efforts during the open enrollment period.